Transparency Report #31 – The Value of Team Building and How It Can Improve Performance

Welcome to the 31st edition of the monthly transparency report (for August 2017). This series is all about sharing what’s been going on in the company from an organizational and business point of view. Click here to see the previous reports.

I want to touch upon a lot of things in this report, so here’s a quick TOC just to keep things organized (and in case you’re not interested in all of it, which is fine):

Overall, we experiment quite a lot as an organization. We try to learn from other business in the same niche and outside of it, and then fit new methods and approaches into our own workflows, mission, etc. Sometimes, this leads to reinventing the wheel (unfortunately), but, other times, it leads to innovation and making our work a lot easier and effective on a daily basis.

Below, I want to share a couple of such things that we tried implementing, plus the learnings that resulted.

Don’t be harsh, though (please), I am a bad manager, and I love to patch things up randomly in an effort to “growth hack” this or that. Overall, many of these ideas are not part of any grand strategy.

1. On being transparent

We have experimented with a number of concepts in this realm, and while some worked well, others have failed … significantly.

What has worked? Obviously, these reports in themselves. Having to come up with relevant findings, thoughts, and learnings every month puts a lot of pressure on me, but it’s all pressure of the good kind. Writing a transparency report often leads me to completely new ideas and a better perspective on the whole business.

So, what hasn’t worked? One of the things we experimented with on and off was a public (internally) salary grid. Buffer does this on a much bigger scale. They say they’re happy with it. Failed for us, though.

The good: It helped me connect with the current (as well as future) employees better and also helped shape the company’s identity.

The bad: It increased in-team competition sooner than I expected and decreased privacy.

Now, about that last thing. Although it’s just an assumption, I’m thinking that having salaries public maybe does work for an US-based company, but if you’re from Romania (or Eastern/Central Europe in general) then it’s perhaps not the best idea overall. In other words, I’ve started to appreciate the value of privacy more and more lately, and it’s now one of my no.1 web-related concerns.

I originally started with the whole salary grid idea because I believed in it in principle. However, after a while, when I asked people about it – the actual people whose data was in the grid – nobody was keen on keeping it. In the end, it just didn’t feel right to make the grid a mandatory element if you’re part of the company. It should be everyone’s own decision whether they want to share what their salary is or not.

On the good side, the grid revealed some prior-existing problems, and overall helped us realize that we first need to implement a kind of regular feedback machine that would make it possible to review each other’s work based on performance. Only then we should start getting into salaries.

2. Why you need company retreats

We have this thing that we’ve been doing since two years ago. It started by us picking a weekend and having ourselves a seaside party. While this worked perfectly cool for 4-5 people, as the team grew, we’ve come to the conclusion that the form of it in itself probably doesn’t feel like a retreat for everyone.

This year, we all voted to have a full week-long retreat in a more quiet environment where we could enjoy the nature, spend some quality time together, and also get some cool side projects done.

Ultimately, 12 people participated, and we all had a great time!

We thought up a number of cool activities for ourselves to take part in, but it was not all leisure. For instance, we did a “Support Day” where the whole team (including myself) engaged and tried solving as many tickets as possible. We also did a “hackathon,” during which we took some non-standard client requests (like custom CSS and site modifications, etc.) and did our best to make them happen.

As a side note; we also realized that those sort of things – support days and hackathons – could easily be done from the office as well. Say, we could devote a day every month to initiatives like that.

Here is our calendar if you want to get an idea how it all got planned out:

3. Working from home and the problems with it

Albeit the majority of the team works from our office in Romania, I’d still say that we’re a distributed company at our core.

We have several people working with us internationally. More or less, that’s how the company started – we first looked for specialists to work with us remotely, and only then decided to open the main office in Romania.

So, in the end, since remote work has been such a key component for us, we do let the Romanian team work from home if they so please. However, this does create some struggles. Two in particular:

(1) Having an office and also allowing people to work from home creates a disconnect between your office workflow and at-home workflow. For instance, being allowed to take one work-from-home day per week makes that day feel like half-vacation. Not to mention that it might also be perceived as a bonus.

In the end, without a clear and transparent way to evaluate performance, those work-from-home days can become more like “unproductive-work-days.” The ideal scenario, of course, is for everyone to learn to be just as productive no matter where they work from, but that can be tough at times.

(2) Having people shuffling around and coming / not coming to the office on any particular day disrupts everyone else’s workflows and creates chaos.

Taking all that into consideration, we’ve tried coming up with a policy that would work for everyone. What we have right now is this:

you can work either fully remotely or fully from the office,

if you’ve opted to work from the office, you can take 2 days a month to work from home (if you want more than 2, you need to bring this to discussion).

This is not perfect. I know. But it’s a direction we’ve been testing, and surely something that we’ll continue improving based on the team’s feedback.

4. The value in vacation days for all team members

Everyone working with us full time at the office gets their vacation days normally. That’s obvious.

However, there’s also the other part of the team – the people working internationally who are not technically employed by the company.

I initially thought of them as freelancers. Meaning that they got paid according to their per-hour rate with no other benefits. But as time passed by, and some of those people have stayed with us for longer, I’ve realized that I should begin caring more about their wellbeing and offer them more benefits than just their standard pay.

I mean, initially, I thought that since they generally earn more than the in-office employees, they should be able to manage everything else by themselves – including their vacation time, etc.

However, in practice, this can be hard.

Editor’s note; I’m one of the international guys, by the way. Speaking from my own experience, the thing with vacation as a freelancer is that you have to be willing to take a “double pay cut” if you want to go on vacation.

Basically, by definition, you shouldn’t work at all when on vacation, and since you bill your clients per hour of your work … well, you get the story.

So at the end of your vacation week, it’s not only that you’ve spent money on the vacation itself, but you also have no paycheck coming your way for that time period. Hence, double pay cut.

As a result, very few freelancers can actually afford to comfortably not work for a week or two and take a true vacation break.

As you’d imagine, this isn’t very motivating, and even though freelancers technically have the ability to take an unlimited number of vacation days per year, very few of us actually take more than, say, 10. Most work year-round.

This has led me to decide to offer paid vacation time to the international team as well. The only rule is that you can’t work while on that vacation. Albeit this is one more added cost for the company, it encourages people to be healthier and thus keep their productivity at high levels throughout the year, hopefully. 🙂

Lastly, inspired by Automattic and my own health challenges, I’ve decided to offer a paid sabbatical of 3 months to everyone who’s been working with us full time for over 5 years. Having a break like that can do wonders for your drive and motivation!

5. How we’re improving team management and performance

I’m not the world’s best listener. I tend to focus too much on my own perspective and mistakenly assume that other people wish for the same things, dislike the same things, and have overall similar goals as I have, at least professionally.

For instance, I always struggled to push some people towards an entrepreneurial approach. I offered them shares in the company, only to find out later that they didn’t even care about that.

Frankly, not everybody feels like (nor wants to be) an entrepreneur, some people just want clarity and stability in what they do, and … well, a job.

So, in the end, what I should do first of all is make that job easier and more enjoyable for people, while also paying attention to what really drives them, as opposed to wondering what would drive me.

One thing I did to start working towards that is try out a more tiered approach. We’ve appointed “teams” and “team leaders,” and set workflows to follow.

We still struggle a bit with how things should work specifically, and we’re a bit chaotic here and there, however, we’ve managed to come up with a couple of improvements to the whole process:

Set a general learning schedule for all teams. This includes something like a workshop every 6 months and a review/analysis of the team’s work every 6 months also. This is to make sure that everybody always works on improving their output instead of just going through the motions.

Send a survey every 3 months to monitor some internal metrics, like, “are you happy with your salary, with the stuff you learn, with the things you do.” This is to prevent long stretches of issues that compound on each other over time.

Have a performance review every 3-6 months. Currently, we don’t do much in this regard. There’s just a short general review annually, plus something during the year if there are any serious issues to tackle.

Another thing – and this is something we didn’t pay much attention to before – we have a new policy in place now where if you are considering a paid side project (something you’re doing outside of your employment with the company), you should let us know about that.

This is especially important for the people working full time. It’s both a matter of focus and sanity. I believe that bringing things like that into discussion is the best thing that can be done.

For me, considering taking side projects to earn extra money is a signal that someone might perhaps not be 100% satisfied with what they’re doing as part of their full time employment. Maybe they feel that value is not distributed fairly, or that people are dragging them back, or that there’s another issue within the team, etc. If that’s the case then we need to help solve those issues rather than just allow everybody to take on a number of side projects, and think of their day job as a chore to pay the bills.

Last but not least, I am grateful to the whole team for being patient through all these experiments that are going on!

6. Auto-renewals and how they’ve been working for us

Auto-renewals are an important part of the business for us. We’ve put a lot of thought and effort into designing them (on ThemeIsle especially) and into making sure that our value proposition is on-point and interesting enough for users to want to renew.

However, we haven’t actually had an opportunity to test the renewals in the wild yet. Not until recently…

We’ve just had our first batch of 2000 subscriptions due and up for renewal (from ThemeIsle and Revive.Social combined).

Here are some early results of that (keep in mind this is based on only 4 days worth of data for ThemeIsle and 30+ days for Revive.Social):

For ThemeIsle: 30 people renewed their memberships, while 28 did not. This means the renewal rate is around 50%. I would love to learn more about why people decided to renew or not, but I’m still happy with these results overall. While the revenue in total doesn’t represent that much vs our new users, I think it still has more meaning:

It gives us some brutally honest feedback about the quality of our work, our products, and how well we’re able to cater to our users over time. This goes way above things like reviews or online opinions. People voting with their wallets is always way more insightful.

It allows us to make sure that the products will be supported and maintained over the long haul, and to run a more sustainable business overall.

For Revive.Social: Due to the nature of the products we offer there, I’ve expected the renewal rates to be a bit higher than they actually were. At the time of writing, we have 31 renewals out of 82 (~38% renewal rate).

This is somewhat of a cold shower for us. But I also should have seen this coming. There were hardly any software updates in the past year and not much communication besides announcing new products here and there. We basically have only ourselves to blame.

We’ve already begun taking some steps to fix that, though. We’ve started working on a new version of Revive Old Post, we’re planning to announce it soon, plus offer some perks to people who choose to renew before the new version is out.

Setting the results aside, I still love the membership model overall. You get a lot of freedom in making sure that the value you’re offering for the 2nd or 3rd year is still very high. Provided that you’re adding new products and extra perks continuously.

For example, on ThemeIsle, we added 10 new themes and 6 plugins in the past months, so it was easier for people to see the value in renewing.

We’re also running a lot of A/B tests and re-introducing single-theme packages – in an effort to be more transparent and fair to our customers. We’re doing this for two reasons: (1) I’m not sure our previous analytics data was that clear in regard to how effective those licenses were, and (2) we don’t want our users to feel forced into buying a membership.

Product-wise, for the past couple of months, we’ve been working heavily on Hestia, and we’ve managed to release an initial version of what is called OrbitFox Companion. I mentioned this in one of the previous reports. Basically, it’s our experiment with a Jetpack-like plugin that delivers a set of useful functionalities that go well with our themes.

We also rewrote the WP Product Review plugin from scratch in order to support templates, new JSON-LD and make it easier to maintain, plus we released a pro version of Pirate Forms, to test how users react to that (the forms market is already very competitive and we don’t really plan on focusing too much on it).

As a side note, it’s interesting to see that releasing that one update for WP Product Review caused a major uptick in sales:

So probably your best strategy to increase sales is to keep your products well maintained … something that’s not actually very surprising when you think about it. 🙂

7. Conferences coming up – let’s meet!

There’s a quite busy conference season just around the corner … at least in my part of the world.

It looks like Lisbon is becoming a hub for lots of interesting events. I attended DNX just recently, and I will also be at Web Summit and MicroConf. So if you plan on attending any of those, let me know!

On top of that, I will be speaking at WordCamp Bucharest in a few weeks. The speaker line-up looks great, and I couldn’t be more excited. Again, if you’re attending, let me know!

Ionut Neagu :Love to travel, share and help others, I am working with WordPress at ThemeIsle.com. Passionated by Growth Hacking and the big things around me (trying to understand people, society, economy and our world ).